In with the new
While out with the old is not always the case with real estate in Bermuda, it is certainly becoming prevalent for today’s discerning buyer. Dated kitchens and bathrooms are the death knell of hopeful sellers whether the property is a condominium or cottage.
Bermuda advocates have long sought out the quintessential Bermuda cottage with cedar beams and Dutch doors, at least until recently. There has been a definitive move from the traditional aspirations of home buyers including second and third-time buyers who have exchanged charming and cute for contemporary and functional.
Mill workers will tell you that Bermuda (or Virginia) Cedar do not command the price it once did. Travel the island countryside and you will notice more demolition of traditional design being replaced by more contemporary shutter-free homes.
The idea that newer is better has been demonstrated by the lackluster performance of sales for dated condominiums and homes throughout the island in recent years. Newer or renovated properties stay on the market for a shorter period of time and achieve the best price.
Hence the resurgence of new developments that have been repurposed from their heyday as industry standard hotel/tourism properties. Not all are recognized as luxury, such as Wedco’s development in Dockyard. Additionally, the new rising standard is exemplified by luxury properties such as Caroline Bay in Southampton, Newstead and Belmont Hills and Azure in Warwick, The Wharf in Paget, Park Place on 10 Dundonald, Belvedere and Queen of the East in Hamilton. The redeveloped hotel properties in the East end of Bermuda now boast the gold standard of luxury condos in such properties as Ariel Sands, The Loren At Pink Beach, Hidden Cove, Rosewood Tucker’s Point and upcoming St. Regis Bermuda Resort and Residences.
With real estate sales prices holding firm over the last few years, property sellers are having to offer more value to buyers in order to hold those prices. Simply put, buyers get more for their money today compared to five, or even eight years ago. It might be time for “out with the old”.
So, what is the state of the market?
Average sales prices of homes under $126,000 ARV remain firm around $1.1 million. Condominiums with an ARV greater than $25,800 continue to sell at an average price of around $850,000 to $900,000. In every category of property, it still remains a buyers’ market where replacement costs exceed market value in 2018.
This article was originally published in the September 2018 edition of RG Business